McNamara quits. He was the best contractor in the country and the man that Dagny counted on to complete the Rio Norte Line. McNamara walks out on a pile of contracts, and nobody knows why or where he went. The People's State of Mexico nationalizes both the San Sebastian Mines and the San Sebastian Railroad. In his report to the board, James Taggart takes credit for Dagny's decision to move north of the border every piece of railroad equipment that could be transported.

The National Alliance of Railroads passes the Anti-dog-eat-dog Rule, which, as its principal consequence, will cause the Phoenix-Durango Railroad to shut down its Colorado operation within nine months. When Dagny hears of the Rule, she rushes to see Dan Conway, president of the Phoenix-Durango, and urges him to fight the resolution. But Conway responds that he joined the Alliance and voluntarily agreed to follow the majority ruling; he encourages Dagny to repair the Rio Norte Line as quickly as possible, because people like Ellis Wyatt can't be left without transportation. Later, Ellis Wyatt bursts into Dagny's office and informs her that just because Taggart Transcontinental pulled a rotten trick to get rid of its competitor, he won't accept the railroad's current inferior service. Wyatt tells Dagny that if the railroad expects to make money carrying the oil he produces, it must run its business as efficiently as he runs his. Dagny tells Wyatt that he'll have the transportation his company requires.

Dagny tells Rearden that she now needs the rail for the new railroad over a nine-month period, rather than the twelve months of her original plan. Rearden tells her that she'll have the rail. Rearden believes that he and Dagny are a pair of scoundrels who only care about industrial production and profit-making and that they are devoid of any spiritual qualities. But, he concludes, whatever else they may be, they are the people who get things done and move the world.

Analysis

The retirement and disappearance of McNamara adds to the mystery of the story. Why are talented and accomplished individuals leaving? Where are they going? Who is responsible for it? Nobody knows the answers to these questions yet. McNamara was the best contractor in the country, and his sudden retirement makes it significantly more difficult for Dagny to complete the Rio Norte Line.

The Anti-dog-eat-dog Rule is the logical result of a mixed economy — one in the process of rejecting capitalism. When the government has the power to control and regulate private business, it's in a position to dispense economic favors. For example, Jim Taggart can get what he wants from the National Alliance of Railroads in exchange for influencing the politicians to pass legislation that will rob Rearden and benefit Orren Boyle. Boyle makes this point when he sees Taggart after the Alliance votes to approve the Anti-dog-eat-dog Rule. "I've delivered," he says. "Your turn now, Jimmy." Boyle's meaning is clear: He has used his connections in the Alliance to influence the vote, enabling James Taggart to kill the Phoenix-Durango line. Now it's Taggart's turn to return the favor. Taggart must use his political connections to convince the legislature to pass a law that will strip Rearden of his ore mines. The plan is to sign the ore mines over to Paul Larkin, who will give Boyle first claim on the ore.

The corrupt deal brokered by James Taggart and Orren Boyle will harm Hank Rearden and Dan Conway in order to serve the short-term interests of Taggart Transcontinental and Boyle's Associated Steel. Productive men like Rearden and Conway stand to lose either the bulk of or an important component of their businesses, which are torn from them to feed scavengers like James Taggart and Orren Boyle. Men like Rearden and Conway produce value by means of their own effort; they require only freedom to do it. They don't run to the government for favors or handouts, and they don't believe in granting such power to the government. Conversely, parasites like Taggart and Boyle seek to benefit from governmental coercion, because they are too incompetent to compete in a free market. Customers value the products of their superior competitors, and that threatens their livelihood. For example, Colorado shippers prefer Phoenix-Durango to Taggart Transcontinental, and the consumers of steel prefer Rearden's product and service to Boyle's. Rand wants to show that a socialist system always harms the most productive members of society as a means of benefiting the short-term interests of the less productive. The necessary result is a steadily declining standard of living.

Rand also uses the passage of the Anti-dog-eat-dog Rule to illustrate the error of believing in majority rule. A group is merely a collection of individuals, and just as one individual may be mistaken, so may be any number of other individuals. For example, the majority once believed that the sun revolved around the flat earth. The will of a majority is insufficient to make a belief either true or morally right, and such is the case with the proposal ratified by the National Alliance of Railroads. The purpose of the ratified proposal is to rob one of the most productive members of the Alliance (Dan Conway) to benefit the least productive (James Taggart). In this chapter, Rand proves that a man must use his own most scrupulous judgment to arrive at what is true and right, because the blind acceptance of the majority's belief doesn't provide the answer. For example, a rational man like Dan Conway should not agree to abide by the will of a majority or, if he has already done so, he must rescind his agreement when the group demands that he commit suicide. The concept of majority rule is a form of collectivism, the belief that an individual must subordinate himself to the group. Rand's claim throughout this book is that an individual must conduct his life in accordance with his own rational thinking; he must not surrender his mind to the majority.

Another important theme continued in this chapter is the inner struggle of Hank Rearden. In the midst of discussing the virtues of Rearden Metal with Dagny, he asserts that the two of them are blackguards because they only care about making money. "We haven't any spiritual goals," he says. "All we're after is material things." Dagny, of course, repudiates this thought. She feels concerned that Rearden should have such an unjust view of himself. Rearden holds a premise that undercuts his potential and prevents him from recognizing the full greatness of his own achievements. He believes that the things of the body — including the creation of new metals — are vulgar and low, lacking all higher "spiritual" qualities. He believes that the more noble purposes of the spirit are devoid of material or bodily concerns. But despite his error — which proceeds from an essentially religious way of thinking — Rearden understands that productive individuals such as himself and Dagny carry the world forward. Men depend on them for material progress.

Glossary

The Immovable Movers The immovable mover is one who causes motion. The term refers to productive giants such as Dagny Taggart and Hank Rearden who, because they generate their own action, carry the world forward. Immovable movers are the rare individuals who hold and pursue a new vision of life's possibilities and are responsible for innovations and progress.